Clearly Erroneous Execution

On September 10, 2010, the SEC approved rules that expanded the stock-by-stock circuit breakers and clarified the process for breaking erroneous trades. These changes were incorporated into the NYSE Arca Equities Rule 7.10. These changes were also adopted by the other exchanges in the national market system.

A transaction is defined as ?clearly erroneous? when there is an obvious error in any term, such as price, number of shares or other unit of trading, or identification of the security. CEE Requests for Review are processed using a web-based submission service, which was designed to expedite and simplify the review process.

To process the request in this manner, please save the form to your computer desktop with the relevant information and email the attachment to NYSE Arca.

Order Processing

NYSE Arca maintains an electronic file to display and match orders, which are handled using three processes:

Display Order Process ? Market orders or marketable limit orders are instantly matched with the book orders that represent the best market price. Non-marketable limit orders are posted to the book. Limit orders have the highest priority in the book, followed by working orders, then tracking orders.

Working Order Process ? Working orders that cannot be matched against the ArcaBook are eligible for matching with non-displayed NYSE Arca interest ? such as the non-displayed portions of reserve orders and discretionary orders.

Smart Order Routing ? If the best price isn?t available on NYSE Arca, the order can be automatically routed to another market center using our smart order (SmartBook®) routing algorithm.

Limit orders are ranked and maintained in each process based on order type. For example, a limit order is stored in the Display Order Process. The displayed portion of a reserve order is ranked in the Display Order Process, while its reserve portion is filed in the Working Order Process. This allows all orders to be organized by time of entry, adhering to our price-time priority.

The order book operates on an open basis. Orders at all price levels in the Display Order Process of the ArcaBook will be displayed to all users and other interested parties on an anonymous basis unless they are designated as attributed quotes. The best-ranked displayed order(s) to buy and sell in the Book and the corresponding aggregate size of these orders associated with such prices will be collected and made available to quotation vendors.

Routing Policy

NYSE, NYSE MKT and NYSE Arca (the ?Exchanges?) route orders to away markets through either an Exchange affiliated router or one or more third-party routing brokers pursuant to NYSE and NYSE MKT Rule 17 and NYSE Arca Rule 7.45. Each third-party routing broker used by the Exchanges has its own policies and procedures with respect to the manner in which it may round or truncate execution prices that extend beyond four decimal places. Some third-party routing brokers may round to the fourth decimal place, while others may truncate to the fourth decimal place, before returning executions to the Exchanges. With the exception of routing in BRK A, those policies and procedures are established by the third-party routing broker and are not established by or at the request of the Exchanges and are not overseen by the Exchanges. In the case of BRK A, all executions returned in more than two decimal places will be truncated to two decimal places.

Routing Policy & Process

NYSE, NYSE MKT and NYSE Arca (the ?Exchanges?) route orders to away markets through either an Exchange affiliated router or one or more third-party routing brokers pursuant to NYSE and NYSE MKT Rule 17 and NYSE Arca Rule 7.45. Each third-party routing broker used by the Exchanges has its own policies and procedures with respect to the manner in which it may round or truncate execution prices that extend beyond four decimal places. Some third-party routing brokers may round to the fourth decimal place, while others may truncate to the fourth decimal place, before returning executions to the Exchanges. With the exception of routing in BRK A, those policies and procedures are established by the third-party routing broker and are not established by or at the request of the Exchanges and are not overseen by the Exchanges. In the case of BRK A, all executions returned in more than two decimal places will be truncated to two decimal places.

Opening Auctions

At 4:00 a.m. ET, Limit Orders designated for the Opening Session are matched and executed in the Opening Auction. NYSE Arca will accept orders for the Opening Auction beginning at 3:30 a.m. ET, and will continue accepting orders until the Opening Auction is conducted. Only limit orders that are eligible for the Opening Session will participate in the Opening Auction. Orders that participate in the Opening Auction cannot be canceled between 3:59 a.m. ET and the conclusion of the Opening Auction.

The Opening Auction will occur at the Indicative Match Price ? the price at which the maximum volume of orders is executable at the time of the auction. If two or more prices can maximize executable volume, the Opening Auction occurs at the price closest to the previous closing price. NYSE Arca uses the maximum size of both sides and displays the worst price at the larger aggregate size. Unexecuted orders become eligible for the Opening Session immediately upon conclusion of the Opening Auction.

Market Order Auction

The Market Order Auction serves as a bridge between the Opening Session and the Core Trading Session. The execution of the Market Order Auction is the first trade of the Core Trading Session.

Limit orders (eligible for either the Opening Session and/or Core Trading Session), market orders and auction-only limit orders will participate in the auction. With the exception of limit orders that are eligible for the Opening Session, orders that participate in the Market Order Auction cannot be canceled between 9:29 a.m. ET and the conclusion of the Market Order Auction. This restriction does not apply to Opening Session-eligible limit orders, because these orders will be accessible in NYSE Arca during continuous trading between 9:29 a.m. and 9:30 a.m. ET. Core Trading Session-only limit orders, however, cannot be cancelled between 9:29 a.m. and 9:30 a.m.

Market orders and auction-only limit orders that would participate on the same side as a market order imbalance cannot be entered into the Market Order Auction between 9:29 a.m. ET and the conclusion of the auction. For example, if the aggregate volume of market sell orders in the Market Order Auction is 30,000, and the aggregate volume of buy orders (including market and limit orders) is 25,000 shares, a market order imbalance on the sell side exists ? so NYSE Arca will not accept market or auction-only limit orders to sell between 9:29 a.m. ET and the conclusion of the Market Order Auction. As with the Opening Auction, NYSE Arca will calculate and continually disseminate the indicative match price, the indicative match volume and the auction imbalance. At 9:30 a.m. ET, the Market Order Auction will execute at a single price and all unexecuted orders will be released into the Core Trading Session.

The match price is the price that maximizes the volume that can be executed. The Market Order Auction will use the match price closest to the closing price of the previous trading day (based on normal market hours) if more than one indicative match price is valid. Imbalances and indicative match prices in the Market Order Auction reflect market orders only. In the following examples, the limit orders are "auction only" limit orders.

Examples

1. 9:30 a.m. ET: Previous close of 17

Entry Time

Buy Limit Orders

Sell Limit Orders

Order Price

Matchable Volume

Imbalance

Indicative Match Price

8:30

1000

$19.00

0

0

-

9:00

1000

Market

1000

0

$19.00

9:05

1000

$20.00*

1000

0

$20.00

9:25

1000

$18.00*

2000

0

$18.00

*Limit orders designated as auction only orders.

Result: all orders executed at 18.00.

2. 9:30 a.m. ET: First NBBO disseminated is $15.00 - $15.10

Entry Time

Buy Limit Orders

Sell Limit Orders

Order Price

Matchable Volume

Imbalance

Indicative Match Price

8:31

1000

Market

0

0

-

8:38

1000

Market

1000

0

$15.05

Result: Orders are crossed at $15.05

Closing Auctions

Similar to NYSE Arca?s current Opening Auction, the Closing Auction is a single-price Dutch auction that matches buy and sell orders at the price that maximizes the amount of tradable stock. NYSE Arca will calculate and continually disseminate the indicative closing price, indicative closing volume and the auction imbalance prior to the start of the Closing Auction, which occurs every trading day at 4:00 p.m. ET.

Closing Auction Timeline (all Eastern Time)

9:30 AM

Initial order collection

3:00 PM

Initial broadcast of imbalance information

3:59 PM

Freeze period begins

4:00 PM

Auction run/closing price disseminated

The NYSE Arca trading platform will only accept Market On Close (MOC) and Limit on Close (LOC) orders for NYSE Arca exclusive securities.

The non-displayed portions of discretionary orders will not participate in the NYSE Arca Closing Auction. Between 3:59 and 4:00 p.m. ET (the freeze period), MOC and LOC orders cannot be cancelled. MOC and LOC orders that do not increase or flip the imbalance will be accepted for Auction processing (e.g. if there is a buy imbalance, no buy MOC or LOC orders will be accepted) during the freeze. Orders participating in Core Trading can be cancelled during the freeze period. Additionally, Market Orders entered during Core Trading that are not identified as MOC orders will not be included in auction calculations or participate in the Closing Auction.

Freeze Example

A 500 share sell imbalance exists at 3:59 p.m. ET

An MOC or LOC to buy 500 shares would be permitted because it achieves equilibrium

However, an MOC or LOC order to buy 1,000 shares would not be permitted as it would inverse the imbalance of 500 shares on the sell side to an imbalance of 500 shares on the buy side.

Any imbalance in the Closing Auction may be reduced by new orders, entered on the side of the market opposite the imbalance, using the following priority order:

Market-on-Close Orders

Limit-on-Close Orders

The MOC orders that are eligible for, but not executed in, the Closing Auction shall be cancelled immediately upon conclusion of the Closing Auction

Publishing Order Imbalances

Beginning at 3:00 p.m. ET and updated real-time thereafter, the Indicative Match Price, the volume to trade at that point, and any order imbalances associated with the Closing Auction, if any, will be published by NYSE Arca in both the ArcaBooksm data feed and on the website. The following information will be published:

Market Imbalance ? the imbalance of any remaining buy (sell) MOC orders that are not already matched for execution in the auction

Total Imbalance Reflects the total net imbalance of MOC, LOC and orders displayed in the ArcaBook

Indicative Match Price ? The price at which the maximum volume of shares are executable

Determining Closing Auction Price

Until the time the Closing Auction is run, orders entered in the Core Session will continue to trade in the Core Session. At 4:00 p.m. ET all orders entered for the Closing Auction in addition to all displayed orders in the ArcaBook will be included in the Closing Auction.

If there is no order imbalances, orders will be executed in the Closing Auction at the Indicative Match Price as of 4:00 p.m. ET and the indicative match price will be the price at which the maximum number of shares in the total imbalance can execute

If there are multiple prices at which the total imbalance can equally execute, the indicative price will be based on the price closest to the last sale

If the price closest to the last sale would trade through the ArcaBook, the indicative match price will be the best price available where no trade through occurs

If an imbalance exists, or if equilibrium exists between buy MOC orders and sell MOC orders and an Indicative Match Price doesn?t exist, as many buy MOC orders and sell MOC orders as possible shall be matched on a time-priority basis:

At the midpoint of the NBBO at 4:00 p.m. ET, provided that the NBBO of the market centers that are still open is not locked or crossed

At the locked price if the NBBO is locked at 4:00 p.m. ET

At the bid (offer) side of the BBO which is crossed with the NBBO, if the NBBO is crossed at 4:00 p.m. ET and NYSE Arca is a party to the crossed market

At the last sale during the regular market hours as determined by the consolidated tape, if the NBBO is crossed at 4:00 p.m. ET and NYSE Arca is not a party to the crossed market

Example 1

Buy Volume

Price

Sell Volume

Order Description

1,000

Market

MOC

$10.15

5,000

Continuous Trading

4,000

$10.05

LOC

5,000

$10.00

Continuous Trading

Market

5,000

MOC

The following information will be disseminated via the ArcaBook data feed and displayed on NYSE Arca?s Auction web page:

Total Imbalance: 0 (there are no remaining shares to buy or sell stock at the indicative match price)

In this example, the 4,000-share LOC order has priced the auction at $10.05 (placing the order ahead of the bid in NYSE Arca?s continuous trading system) by providing the most competitive price for the 4,000-share sell imbalance.

Example 2

Buy Volume

Price

Sell Volume

Order Description

1,000

$50.00

LOC

$49.75

5,000

LOC

Market

2,000

MOC

The following information will be disseminated via the ArcaBook data feed and displayed on NYSE Arca?s Auction web page:

Since there are multiple prices at which the total imbalance can be equally executed in this example, the last sale is used to determine the auction price.

Closing Auction Price Collars

The Closing Auction will not execute at a price that is greater than 10% away from the consolidated last sale for stocks priced $10 and above or 25% away from the consolidated last sale for stocks priced under $10. The Closing Auction will automatically execute eligible orders within the parameters of the policy.

Example

If the consolidated last sale is $20, the Closing Auction could only execute between $18 and $22 (plus or minus 10% from the last sale of $20)

If the consolidated last sale is $5, the Closing Auction could only execute between $3.75 and $6.25 (plus or minus 25% from the last sale of $5)

NYSE Arca may change these thresholds periodically upon prior notice to ETP Holders.

Reporting Trades

All trades that participated in the closing auction will be reported to the tape as regular-way trades. In addition, NYSE Arca will disseminate the Core Closing Price to the Consolidated Tape with the *.M* extention ? which will include both the official closing price and the volume of shares executed in the closing auction. For example, if 10,000 shares of ADY are matched in the closing auction at $25.00, resulting in five regular way prints of 2,000 shares each, there will be an additional *.M* print showing 10,000 shares @ 25.00.

NYSE Arca Auctions Tool

NYSE Arca Auctions tool gives investors the unique opportunity to view the stocks that are part of the opening, market order, closing and halted auction process in addition to associated indicative match prices and quantities.

You can access our auctions in one of two ways. The Java version refreshes, the HTML version is static and can be manually updated. Both versions can be accessed via port 80, the standard port to access the Internet, and do not require additional ports to be opened.

Java and HTML versions both refresh automatically and are accessible via any popular browser.

The quantity imbalance is the difference between the present buy volume and the sell volume participating in the auction.

Prior to the opening auction (4:00 a.m. ET) the quantity imbalance is the total imbalance for all limit orders. Between 4:00 and 9:30 a.m. ET this quantity reflects the market order imbalance only.

Total Imbalance

The number of shares of buy orders minus the number of shares of sell orders. A positive Total Imbalance means an excess of buy orders and a negative Total Imbalance means an excess of sell orders.

Matched Volume

The number of shares that are matched.

Indicative Match
Price

The price at which all matched shares would trade at the time the Auction is run.

Indicative Net
Change

The difference between the Indicative Match Price and the previous day's close.

Total
Dollar
Value of
Delta

The Delta is a comparison of the Indicative Match Price and the NYSE Arca last sale. In particular, if the Market Imbalance is less than zero (indicating a sell imbalance), Delta is the NYSE Arca Last Sale minus the Indicative Match Price. Otherwise, Delta is the Indicative Match Price minus the NYSE Arca Last Sale.

Bid Price

The price of the highest price buy order.

Ask Price

The price of the best priced sell order.

Close Price

The price at which the equity closed the previous
trading day.

Arca Auctions do not necessarily represent the best bid or offer in the marketplace. This information is provided for informational purposes only and should not be used for making investment decisions. NYSE Arca believes its data is reliable but is not warranted or guaranteed to be timely or accurate. NYSE Arca shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

NYSE Arca Daily Price File

The NYSE Arca Daily Price File provides valuable information on the exchange's current trading day pricing at the open and close, as well as the daily high and low prices.

You can access the NYSE Arca Daily Price File in two versions. The Java version refreshes; the HTML version is static and can be manually updated. Both versions can be accessed via port 80, the standard port to access the internet, and do not require additional ports to be opened.

The information provided in the NYSE Arca Daily Price is for informational purposes only and should not be used for making investment decisions. NYSE Arca believes its data is reliable but is not warranted or guaranteed to be timely or accurate. NYSE Arca shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. Please refer to the Terms of Use for more information.

Client Management Tool

This fully interactive and secure web-based Client Management Tool (CMT) is available for input and management of trades. The CMT is a multi-functional tool that provides easy order entry, a summary dashboard, reporting tools and clearing functionality for reports. Its highly intuitive interface is built on the same architecture as ArcaVision. You can use your existing Arca CMT logon.

Risk Management Tools

NYSE/NYSE MKT and NYSE Arca are introducing new tools to supplement a firm?s own internal risk management tools. The Risk Management Tools (RMT) is a GUI that allows users to track executed exposure and make real-time adjustments to net exposure limits via a web interface.

Risk Management Tools (RMT) allow firms to:

Define net exposure limits by risk group

Track net notional exposure by risk group on NYSE/NYSE MKT or NYSE Arca

View net notional exposure by symbol or mnemonic

Receive email or web based alerts when nearing or breaching a firm defined limit